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Strategies & Market Trends : Waiting for the big Kahuna

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To: bearshark who wrote (18714)5/19/1998 1:35:00 PM
From: Defrocked  Read Replies (1) of 94695
 
Fed has done several studies on past
changes in margin requirements
but has found no predictable effects
(if my memory still serves me <g>.)
I don't think they'd go that route.

Regarding reserve requirement changes,
such a policy alternative would indirectly increase
cost of funds but acts on an already uncertain
money multiplier which could introduce further
distortions for policymakers currently scratching
their heads about money supply growth.

In contrast, open market operations are generally
more flexible, can be given guidance, easier to change
and more acceptable to the banking community.

I'm looking for No-Action from the Fed today.
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